What this scheme offers
Since 2004, central government employees have been on the National Pension System — a market-linked scheme where the final pension depends on how the invested corpus performs, which is a genuine improvement in some ways but removes the old guarantee of a fixed, predictable pension tied to your final salary. UPS, which became effective from 1 April 2025, offers a choice back: an assured pension of 50% of your average basic pay over the last 12 months before retirement, available to anyone who completes at least 25 years of service, with a guaranteed minimum pension even for shorter careers down to 10 years. Family pension is set at 60% of what the employee was drawing. It's optional — existing NPS subscribers can choose to switch, and new recruits can opt in from day one — and it sits alongside NPS rather than replacing it outright, so an employee who prefers market-linked growth can simply stay on NPS.
Who is eligible
- Central government employees who were in service as of 1 April 2025 and covered under NPS, opting to switch.
- Central government employees joining service on or after 1 April 2025, who can opt for UPS from entry.
- Minimum 10 years of qualifying service required for any pension; full 50%-of-pay benefit requires 25+ years.
Documents required
- Employee service record / PRAN (Permanent Retirement Account Number) under NPS
- Aadhaar card
- Form A2 (for existing NPS members opting to switch to UPS)
How to apply
- Existing NPS subscribers wishing to switch should submit Form A2 through their department's HR/DDO (Drawing and Disbursing Officer) within the window specified by the government.
- New central government employees joining after 1 April 2025 can exercise the UPS option within 30 days of joining, through their appointing department.
- Track your application and fund choice through the PFRDA/NPS portal once your option is processed.
- On retirement, your pension is calculated and disbursed based on your average basic pay over the final 12 months and your total qualifying service — this is handled by your department's pension sanctioning authority, not something you calculate or claim yourself.
- If you're unsure whether UPS or continuing on NPS suits your situation better, consult your department's pension cell before the switch window closes, since the choice has historically been presented as largely irreversible.